UI Files Letter of Intent for Rate Request

ORANGE, Conn.–(BUSINESS WIRE)–In an effort to build on its success in reducing outages and protecting
customers from the effects of severe weather, United Illuminating today
filed a “Letter of Intent” alerting the Connecticut Public Utilities
Regulatory Authority (PURA) to its plan to initiate a rate request this
year.

UI, a subsidiary of AVANGRID, Inc., will propose a new, three-year rate
plan that would increase annual rates by $46 million in 2017, $52
million in 2018 and $43 million in 2019. This request will support
infrastructure replacement, system modernization and vegetation
management efforts that will help UI to maintain excellent reliability
and protect its system against storms.

For customers’ benefit, UI is proposing phasing in the increase over
three years in roughly equal installments. Under this proposal, a
typical monthly residential electric bill would increase by about 5
percent in each year of the plan, starting Jan. 1, 2017. UI last filed a
rate request in February 2013 and is still operating under the old rate
plan.

“In recent years, we’ve made progress toward reducing the frequency and
length of customers’ power outages. We’ve also taken significant
measures to protect our electric system from the effects of severe
weather,” said John J. Prete, president and CEO of Connecticut and
Massachusetts operations at Avangrid Networks. “As we continue to
modernize our infrastructure, harden our delivery system and adopt
state-of-the-art technologies, this new rate plan will help us maintain
the safe, reliable service that our customers have come to expect from
us.”

UI spent $92 million in 2014 and 2015 to replace aging infrastructure
and manage vegetation in order to provide a safe, reliable system. These
and other efforts have helped reduce the frequency of power outages. In
the four-year period ending in 2015, a customer could expect one outage
approximately every two years, down about 20 percent from a decade
before. The company has also focused on vegetation management to protect
customers from the effects of extreme weather. During past storms, trees
within 8 feet of overhead lines were responsible for about two-thirds of
tree-related outages.

If approved, the new rates would take effect in January 2017. For a
typical residential customer, the cumulative total increase would amount
to less than $1 a day in the plan’s final year. The proposed rate plan
would increase a typical 700-kwh monthly residential bill of $162 by
about $9 in each of the plan’s three years. Projections are subject to
change based on UI’s final proposal.

UI now has 30 to 60 days to file a formal application with PURA. In that
document, UI will provide details about the proposed rate plan, and why
it is necessary. Once the application is submitted, PURA will initiate a
full review process that will include public hearings, as well as formal
proceedings in which UI will be asked to provide information to support
its request. A decision is normally issued within 180 days after the
application is submitted.

The request will pertain only to the distribution portion of customer
rates, reflecting UI’s cost to operate and maintain the system of lines,
poles and other equipment that carries electric service to homes and
businesses.

UI’s Standard Service generation rate, which reflects the cost of the
energy itself, is set separately and adjusted twice annually by PURA.
That generation rate will fall by about 25 percent on July 1, from 10.74
cents to 8.02 cents per kilowatt hour. Generation accounts for about 40
percent of a typical residential electricity bill, and customers may
also choose to purchase generation service from alternate suppliers at
market prices.

About AVANGRID: AVANGRID, Inc. (NYSE:AGR) is a diversified energy
and utility company with more than $30 billion in assets and operations
in 25 states. The company operates regulated utilities and electricity
generation through two primary lines of business. Avangrid Networks
includes eight electric and natural gas utilities, serving 3.1 million
customers in New York and New England. Avangrid Renewables operates 6.3
gigawatts of electricity capacity, primarily through wind power, in
states across the United States. AVANGRID employs 7,000 people. The
company was formed by a merger between Iberdrola USA and UIL Holdings
Corporation in 2015. IBERDROLA S.A. (Madrid: IBE), a worldwide leader in
the energy industry, owns 81.5% of AVANGRID. For more information, visit www.avangrid.com.

About UI: The United Illuminating Company (UI), established in
1899, is engaged in the purchase, transmission, distribution and sale of
electricity and related services to approximately 328,000 residential,
commercial and industrial customers in the greater New Haven and
Bridgeport areas of Connecticut. UI is a subsidiary of AVANGRID, Inc.
(NYSE: AGR). For more information, visit www.uinet.com.

Contacts

Media
Michael A. West, Jr., 203-499-3858
Michael.West@uinet.com